Continuous investment in innovation more profitable

An investment in research and development work pays off - especially if the efforts are kept in operation even during economic downturns. This is shown by a new study from CESIS, Centre of Excellence for Science and Innovation Studies.

The director of the centre, Professor Borje Johansson, JIBS, together with Professor Hans Lööf, Royal Institute of Technology, have studied how the productivity of businesses is affected by the perseverance of investments in research and development. In the study, companies that engaged in innovation activities continuously over a 10-year period were compared with companies whose innovation efforts were more irregular. The study shows that the more steadfast companies created about 10 percent higher value added per employee per year.

”Engaging in innovation, constantly, every year, creates two things; new products and knowledge, both of which are very important,” says Hans Lööf.